lawsuit threatens news corp deal !!!

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    Lawsuit threatens News Corp deal
    By James Daley
    Published: 02 September 2005

    News Corp, the media company headed by Rupert Murdoch, is facing a legal challenge against its recently announced purchase of the US internet company, Intermix Media, with a group of shareholders claiming the business was sold well below its true value.

    Marc Moller, at the US law firm Kreindler & Kreindler, is leading a class action against the Murdoch company, claiming Intermix was sold for at least $400m (£218m) less than it is worth, allegedly robbing the company's investors of millions of pounds of value.

    News Corp's Fox Interactive, which owns the group's online assets, agreed to buy Intermix for $580m in July. Intermix's main asset is the US's fifth most popular internet site, www. myspace.com, which allows users to chat online.

    Mr Moller claims that given companies such as Google are valued in excess of $10bn, the value of myspace.com must be considerably higher. He is calling on the company to open its books, to allow a formal valuation of the business. "We believe the proper value of the company is far, far in excess of the price negotiated by Intermix and Fox," Mr Moller said. "Our estimate is that the value is far in excess of $1bn. We think the directors ... simply sold the company to get out from under, perhaps to realise the stakes they had, or to protect their interest."

    Shareholders will be asked to approve the deal at a meeting on 28 September. Intermix was unavailable for comment.

    News Corp, the media company headed by Rupert Murdoch, is facing a legal challenge against its recently announced purchase of the US internet company, Intermix Media, with a group of shareholders claiming the business was sold well below its true value.

    Marc Moller, at the US law firm Kreindler & Kreindler, is leading a class action against the Murdoch company, claiming Intermix was sold for at least $400m (£218m) less than it is worth, allegedly robbing the company's investors of millions of pounds of value.

    News Corp's Fox Interactive, which owns the group's online assets, agreed to buy Intermix for $580m in July. Intermix's main asset is the US's fifth most popular internet site, www. myspace.com, which allows users to chat online.

    Mr Moller claims that given companies such as Google are valued in excess of $10bn, the value of myspace.com must be considerably higher. He is calling on the company to open its books, to allow a formal valuation of the business. "We believe the proper value of the company is far, far in excess of the price negotiated by Intermix and Fox," Mr Moller said. "Our estimate is that the value is far in excess of $1bn. We think the directors ... simply sold the company to get out from under, perhaps to realise the stakes they had, or to protect their interest."

    Shareholders will be asked to approve the deal at a meeting on 28 September. Intermix was unavailable for comment.

    :)
    LC
 
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